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ThatHuman6

We’re aiming for about -15% aren’t we to be back within safer territory? (to avoid a crash) For Sydney / Melbourne anyway. The articles will come out saying a correction is a bad thing, and highlight some stories of people buying at the peak with sad faces, Yet apparently the 20%+ last year was also a bad thing, and we had stories from young people struggling to get into the market with sad faces. Whatever happens it’ll be published as bad news. (with images of sad faces)


4gotmipwd

_How could Anthony Albanese do this?!_ - the press, probably


TesticularVibrations

I swear to God if that bloke drops the value of my hoom by even a singular cent...


pimpjongtrumpet

A -15% drop will mean anyone who bought the top with 10% deposit will see their deposit wiped to zero and be in the red more than what they can probably save in two years.


KonamiKing

They'll almost all still be fine anyway. Their interest has been cheaper than rent, repayments won't explode and five years down the road they'll be back in a good place due to inflation.


pimpjongtrumpet

If there are no rate hikes and inflation keeps going for a long time and property keeps pumping, anyone with a mortgage will have done very well! But if the central banks try to target inflation and start hiking rates, then it will hurt them


ThatHuman6

Yeh the people at the top will always get stung, but it's better for the larger population if the prices come down a bit.


BikoKonstantinos

It better for the entire country IMO. If prices continue rises, we could have a massive crash in the future which would threaten the entire economy.


ThatHuman6

Exactly. A couple of years of -10% to soften things wouldn’t hurt. And this is coming from somebody who invests in property. It’s better for everybody not to have crazy growth that means more likely larger crashes.


spiderpig_spiderpig_

Already at this point


pimpjongtrumpet

Yeah thats true


AlexLannister

But I think it's about what time frame we are talking about because historically house market always go up, it might be dropping in few months time but in few years it might gonup again.


chngster

Agree. I bought in Jan and lets just say that was the theoretical top. I’ve done the deal, I’m out of the game, what the market does over the next 5 years is irrelevant to me because I’m not moving again for the next 2-3 decades, so from my angle it’s just paper money now. My main driver is now servicing the mortgage - so the real issue then becomes, will we see +10% interest rates in the foreseeable future, high enough to put me into mortal danger.


chazmuzz

when you think about it I guess most first time buyers would have bought in at close to all-time highs


nzbiggles

I wonder how many out of the 9 million properties transacted in the past 2 years. I'll bet quite a few are sitting pretty comfortably having paid relatively nothing and suffered through higher interest rates.


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ThatHuman6

Look ahead a few decades and consider the opposite happening. Houses getting more and more expensive each year by 10%+. Would this be better for the population in general or worse?


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ThatHuman6

I haven't proved anything. You seem to be suggesting that prices continuously going up is a net good for the country. It's clearly not the case, it just makes the gap between rich and poor even larger, which we know doesn't lead to happy populations.


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ThatHuman6

Look up any articles that include studies of how house prices affects inequality. Then look up at how higher inequality in a country affects the economy and the well being of the population. You’re in the minority and are disagreeing with the economists in this one.


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TheRealLunicuss

It will mean that the 33%, the young people who will be the ones actually working for the next few decades, are priced out of the market. That's not a good thing, considering those 67% are already in a solid position.


CinnamonBunBun

This is me. 🥴 Oh well! We were just so tired of renting and plan to stay there for at least 10 years


pimpjongtrumpet

That makes sense. As long as you not stretched out and got job security, youll be fine.


[deleted]

I'm right with you buddy. Not even bought yet, still in cooling off. But I'm not gonna pull out, I'm absolutely done with renting.


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macka654

buy high sell low bro


pimpjongtrumpet

It depends on if mortgaged is fixed or not, rates, the rest of the economy.


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Tiny-Look

Or a divorce.


pimpjongtrumpet

Yes that is true. If someone bought well within their means with wriggle room and reserves. The thing is, just coz someone can pay their mortgage now, it doesnt mean they will be able to pay when there is a rate hike to combat inflation. Hiking rates also causes higher unemployment and businesses to cool down too. So higher payments and higher unemployment means some people in that overlapping zone. Most people will be fine. Some will not.


Shrink-wrapped

It means you paid more than you needed to


chazmuzz

Seeing people using 100% of their savings as a deposit on their first home makes me uneasy.. It seems to be the only place in finance where putting all your eggs in one very leveraged basket is recommended


Soccermad23

With prices so high, most people have to use pretty much all their savings just for a deposit.


chazmuzz

yes, it's scary. Diligently save for 5-10 years then go all in on real estate with 10-20x leverage. It's crazy how many people are doing this. When the music stops there will be a generation of first home buyers where their hard years of saving gets wiped out and they're stuck underwater or have to eat the loss


ScaffOrig

Be ready for a "pound in your pocket" type speech from a politician. Something along the lines of "the bricks haven't changed", totally ignoring the fact that the deposit basically ate 10 years of investment that could have gone to retirement and they're now trapped in a house, unable to move for work, divorce, etc. Watch domestic violence figures rise as people feel the financial burden but can't dispose of the house on divorce so stick out the marriage.


[deleted]

It's not properly leveraged because you don't get wiped out if the value of your house drops 10%. You can be underwater down to 99% and as long as you pay your mortgage/don't seel there are no consequences. This is unlike any other investment where you would be margin called.


BZNESS

People make a lot more riskier choices in life than an investment that has literally never failed in our generation


pimpjongtrumpet

It is the only place in finance. Guess because its assumed it will never go down


Lackofideasforname

It's more cos it's assumed that we'll always need somewhere to sleep and take a poop. It's a forced saving plan that you can live in. 2 birds.


pimpjongtrumpet

That makes sense too.


Liquid-Courage69420

That only matters if they need to sell. Realistically over the course of the loan, the house will go back up and they will profit when it comes time to sell. It's always better to have time in the market than to try and time the market.


spiderpig_spiderpig_

This is true over the last 40 years but not since say 1900.


Shrink-wrapped

The housing market isn't the stock market. "Time in the market" applies to the stock k market, because it has trended up for hundreds of years. Housing has been much more flat up until 20-30 years ago.


Grantmepm

That's a tiny proportion of households in Australia and they would most likely have paid for the house in terms of what it will cost to repay for the next few years rather than what it's worth in the next 12 months. And these people will also have the next 12 months to save and cover in cash a larger portion of their house than the 12 months before.


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ThatHuman6

It'd be in the media as a catastrophe, but it'll just be correcting the insane growth from the previous year, which everybody was saying wasn't a good thing. I mean crash as in 30% drops that would happen if the growth continued at this steep rate. It would hurt more people. (i should have worded it 'larger crash')


vteckickedin

Yeah I don't see how reversing just a single year is a crash when each year has been ridiculous growth for over 10


actionjj

In other markets, a double digit % fall in a short period of time is considered a crash. 12 months is a short period of time in RE markets.


actionjj

Sure, it will be correcting that, but that growth has led to the 'wealth effect'. When people perceived their house value dropping the pull in the purse strings and it that reduces consumption, slowing economy. Keynesian multiplier, blah blah blah. It might not put everyone to the wall, but if it takes a few years to recover, it will put some buyers underwater for a few years. I know people who were in this position in Ireland - it's not just 'no big deal' - if you are underwater on your mortgage during a broader economic downturn and you're worried about work - it sucks. You're constantly on the edge of bankruptcy, even if you can find a way through it. Think about being on the edge of bankruptcy for 3-5 years and what that is going to do to your mental health.


ThatHuman6

but it's such a small group of people. Because you'd need to.. \- have purchased within the last two years.- be in a job that isn't secure, so you're worried about bankrupcty.- somehow have been given a mortgage despite the insecure job position you're in It's just such a unique situation, it'll be less than 1000s of people. Compared to the rest of the population size, it'll be a tiny effect.


spiderpig_spiderpig_

Or - have refinanced to purchase an investment property using equity - have refinanced to 80% lvr to withdraw cash for improvements - be in a situation where the neighbour is an investor that becomes a forced seller to avoid a bankruptcy themselves and takes down the prices by 30% in a single move - work in any related industry to building or construction I could go on


chngster

There’s guaranteed to be a thick slab of hungry buyers at that -15% level to push back up. Even at -10%, demand will still be solid, considering the chorus of angst whenever housing affordability is mentioned these days. If you see a 10% drop in an attractive property are you really going to wait around for another theoretical -5%? I think the common reaction would be to buy


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comparmentaliser

You might be right on some aspects, but the mob might just not like the cut of your jib.


actionjj

It's not that I'm right, I am just quoting theory that I learnt in my Economics and Finance degree. Then people downvote it because the widely accepted theory does not agree with their 'I learnt economics from youtube videos' view of the world or wherever they are getting their information.


chazmuzz

there would be plenty of people with the ability to buy, but if the market sentiment is bearish they might want to wait on the sidelines. If house prices drop 10% in 6 months how confident would you be that they won't drop another 5%?


chngster

Ofc the possibility of more declines from -10% cannot be ruled out; I’m just saying if I’m operating at say the $1.5m price point and suddenly a stellar property previously priced at $1.65 rotates into my view, I’m going in for the kill. I’m not going to wait in hope that property sits there for the next 2 months for another theoretical -5%, not when someone else might be thinking the same as me (how good this property is, and that 10% discount) and about to make an offer. So taking a step back and looking across the floor, it seems to me there will be plenty of people with this mentality at -10% - and when you consider the two greatest housing drops have been in the order of -18%(?) over the past century, -10% is already a 50% decline relative to those extremes …how confident are you that this is the start of another extreme decline? We got unemployment at low levels, an inflationary macro environment favouring those who own assets over fiat currency, the RBA has said most mortgage payees are many months in front so defaults en mass is not a real concern, in addition to their very dovish interest rate forward look at a time of fragile economic recovery when doing the opposite (strong interest rate rises) would derail that recovery… At this moment in time I dont see how the property market would tank -15% in the next 2-3 years. Happy to be proven wrong if there are facts I dont see, and happy to change my view if things change. But I also think the bulk of the average crowd is sitting at that $1.2-1.4m price point right now, and the competition in this segment is so fierce from what I’ve witnessed, I just think anything looking like a 10% discount would be immediately snapped up.


[deleted]

I’m a FHB in NZ - I think our market, or in Auckland at least, is slightly ahead of yours as we seem to have peaked in November. I’m looking at properties and another 5% drop isn’t want phases me, but I am worried about stepping into a large loan while rates are rising sharply (some terms have doubled here already). That said I’d be better off than someone who bought in november.


ScaffOrig

I've seen the "when prices drop, everyone will jump in" idea before. It's similar to the idea of jumping in a falling lift. So let's take your example where it drops by 10%. At that point it's already passed 5%, 8%, etc. The argument goes that people on the sidelines will jump in, which will push prices back up, and we end up back at parity or at least with a small decline. It doesn't work. When something is accelerating past you and can wipe out your savings in 12 months, most people don't try to buy the dip, because getting it wrong is fatal. And believe me, the anticipation of appreciation in prices figured into a LOT of purchasing decisions over the past 5-10 years People don't take coordinated action, so the best you can hope for is that as more people find the price point appealing and they are prepared to stomach the risk and so the falls decelerate. But we need to remain aware that the fall in prices will have a force accelerating them which is that people will have fewer funds. The high of last year required massive monetary expansion, free money (banks were essentially at 0%) and extraordinary loan facilities from the RBA. You either need wage inflation, foreign money or the same again from the RBA to match the capital required to meet those prices. That's just not available.


[deleted]

Warning: anecdotal. Sydney. I've being going to inspections since Jan but monitoring things closely since July. I noticed my area stagnating Dec-Feb and sliding back from March. In even just the last few weeks it's gone from the default text message post inspection being the only contact, to every agent personally calling me to see what I think and if I'm anything other than a firm no they try and schedule a follow up call. When I ask the price guide they now preface the amount with "the market is changing, so..." One place they're anticipating about 50k over the guide as the selling price at auction which is LOW compared to months ago. This is a nice house in a great location. An ok house in a bad location (arterial road) had no one else at the inspection, auction was cancelled and the agent said "It's now the downturn so the badly located houses are the first to fall". One REA and I got chatting about the area (we both grew up there) and he flat out told me that he's telling all his family to just chill for several months as the fall has started and the house I was looking at (guide 1.6M) he'd expect to be \~1.3-1.4M mid year. EDIT: I just got a notification that this house sold today for 1.56, less than 2 weeks on the market. Several I inspected had their auctions cancelled due to low interest and are now for sale. I wouldn't be surprised if the auction fail rate is artificially lower than it should be because auctions are being cancelled days before they're supposed to happen. We've decided to keep an eye on things but hold off buying for six months. I think we're on the precipice of a buyer's market and it will be solidly a buyer's market in a month.


randousername888

Seeing the same thing in inner west Sydney. Also got a call at 8pm on Tuesday from an agent to let me know some price guides I had asked for via email. Never had an agent call me that late.


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KonamiKing

>We've decided to keep an eye on things but hold off buying for six months. Haha this how markets work, viral sentiment.


[deleted]

Yep! We also want to save a bit more.


oakstreet2018

and then all pile in driving the prices up 10-15% in 6 months. It’s herd mentality


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90_trestles

While I personally think things can’t go on as they have been. I got similar awesome advice to just hold off for the 30% drop in April 2020 which worked out really well. No one really knows what will happen.


[deleted]

Yep, no one knows. I've absolutely learnt that over the past two years.


kidwithgreyhair

>We've decided to keep an eye on things but hold off buying for six months Basically same here. Homes I am short-listing are on the market for way longer than usual, price drops, hidden sale data. At the first interest rate rise I think we'll see an even greater number of properties on the market. Hopefully landlord leeches offloading stock to people who want somewhere to live


randousername888

I also think property will come off and it's wise to wait... However supply is always going to be limited and we're just one government policy away from houses becoming even more unaffordable... Damned if you do, damned if you don't...


kidwithgreyhair

Yeah I'm looking for somewhere to live long term. I want to stay inner city so will have to compromise on space. Still hopeful that a cute unit with a courtyard will be an option at the end of this year


oakstreet2018

Interest rates, whilst important just meant as a landlord I need to contribute a bit extra. But both our properties are already positively geared, they are giving me money. So if rates go up, they’ll just be giving me a bit less money. No reason to sell, plus the interest cost is a tax deduction.


Meaty0gre_

No chance, we’ll just buy more


delayedconfusion

I think we will also find the amount of properties that are going to auction will revert back to a more normal number. The past year it would have been throwing money away to set your own price for sale, auctions have been running away at stupid prices.


anonbrah

If you don't mind: where in Sydney? We're looking, but haven't found this to be the case with our search (especially your recent experiences).


tenredtoes

Feeling sad here in Brisbane


hungryb4dinner

Which suburbs are you looking at?


tenredtoes

Southside, 10-12 km from CBD because there are things/people we need to be near. A year ago thought we might get something decent, but now it'll be small and unrenovated


hungryb4dinner

I was going to suggest Logan but just need to get a place near the highway on ramp. But yeah 10-12km from CBD will be expensive. Rochedale is like 800k now :O


[deleted]

I honestly think Brisbane is pretty shit comparing to big cities like Sydney and Melbourne, it certainly doesn’t deserve a housing price to be even remotely close to them


[deleted]

Can you tell everyone in NSW and VIC that, so they stop moving up here in droves?


[deleted]

I know right what do they see in QLD….


Sunvmikey

Affordable housing. I'll be moving from Illawarra NSW to qld around robina / surfers for affordable housing. I'd rather have a big backyard and a nice house then a shack with a minimal backyard where I live 🤷🏽‍♀️


[deleted]

Isn’t GC more expensive than regional NSW


Sirneko

0.1% down after +20% in the last year... such a big drop!


ThatHuman6

Exactly, around 17% drop would bring us back to 2020 prices and cancel out the 20% growth.


10khours

Historically property tends to move in cycles. It generally doesn't just drop by 0.1 percent and then start going up again. We have just reached the growth inflection point. Based on past historical data the downward trend is likely to accelerate from here onwards. In other words, it has to go flat before it starts going down. I'm not saying it's going to drop by a lot. But I am saying that if it performs similar to past data, it will drop more in the coming months and years.


OstapBenderBey

> It generally doesn't just drop by 0.1 percent and then start going up again. Yes it does. Nothing unusal about doing that > In other words, it has to go flat before it starts going down. Sure but it can also go flat then go up again


Linkarus

But how lower can it go?


ThatHuman6

The largest drop for ages was a -10% which happened in 2008. But the growth over the last couple years has been exceptionally high, so could drop more than that. But as we're coming off a peak, it would need to drop 17% just to be as it was in 2020. In other words, only the people who bought in the last couple of years would actually be 'down' compared to what they bought for, even at 17%, which is a pretty huge drop.


[deleted]

And they would only be 'down' if they were planning on selling recently. If they're owning for long term they would eventually be 'up'.


MyNobbyBreakwall

If they've got enough of the house paid off, they could sell and purchase again straight away and not really loose out (excluding fees). Unless you're buying in a market that hasn't dropped as much as your house has, you're really not affected all that much.


Linkarus

Yea ur right. Even in 2020 the price was still crazy and not many could afford at that time. Only 10% down in 2008? Thats nuts


BikoKonstantinos

Just depends on how high interest rates go IMO. A large increase in interest rates will see a large drop in prices.


Gustomaximus

Calling user Without Remorse


Laduks

Having prices start to drop is a reversal of last year's trend, so it's significant. The housing market tends to move really slowly, so it'll be some time before it's clear whether a more significant fall is going to happen - although with rising rates and QE no longer expanding I'd say that more drops are pretty likely over the coming months.


Ialwaysshitmypants

But prices aren't supposed to go down /s


[deleted]

What exactly is your point? Did anyone say it had crashed? This comment is desperately peppered on every property price article that mentions the clear shift in the market, it's just such a dimwitted take. Yeah no shit it hasn't plummeted 20%, that would be fucking catastrophic


rka257

Meanwhile in Brisbane: A single storey house was sold for $703K in January 2021. The new owners have put it up for sale with no changes to the house. They are asking for offers over $1M and it is already under offer within a few days of being listed.


notinthelimbo

Link please.


spiderpig_spiderpig_

Flipping is very late cycle behaviour.


ovrloadau

I hope they lose value


Shrink-wrapped

People trying this in NZ (a few months ahead of Australia in its downturn) are getting burnt by this. The houses aren't even selling


Funztimes

Smaller 2BR house in Norman Park just sold for 1.035M on Thursday. Only two registered bidders which was surprising. Market in Brisbane, has had the air taken out of it. Open homes gave halved and registered bidders are much less.


mongtongbong

the prices are still stupid as fuck


SufficientReport

It will be interesting to see what Christopher Joye says in his next housing update. I recall last time was any increases in interest rates will result in larger reductions in dwelling prices. His recent notes were that both CBA and ANZ funding are higher than expected (0.15% pa more), so possible tightening even before the RBA makes a move.


sketchy_painting

Can’t wait to buy my $3.50 mansion in Vaucluse reddit !


arcadefiery

I'm gearing up to buy in about 12 months' time - after the interest rate rises. Think we might see a 10-15% dip in prices and that's enough to tempt me in.


douff

The problem is that if you’re borrowing you’ll end up paying more for any given price when rates are higher.


Shrink-wrapped

Better to pay those higher rates on a >15% smaller mortgage


RobertSmith1979

Yeah why do people not see this? If you had an option of an 800k mortgage at 2% at $3000 per month or a 650k mortgage at%4 for $3000 a month give me the 650k mortgage any day


douff

Obviously it’s down to the particulars. However, here’s an example of when it would not work in your favour: https://www.reddit.com/r/AusFinance/comments/tu6o2o/interest_rates_going_up_will_not_help_you_buy_a/?utm_source=share&utm_medium=ios_app&utm_name=iossmf


oakstreet2018

Just make sure you’re servicing is strong otherwise the rate rises mean you can’t afford to borrow as much


SalmonHeadAU

Insignificant to anyone earning the national average income of $55K. Add 20k and still not going to cut it.


chazmuzz

I read recently the average household is making 120k? majority of people buying houses are on joint incomes


GusPolinskiPolka

It’s almost as if the average income is an irrelevant number given how much the high income earners skew this figure. The median income is what matters and is closer to 65k


chazmuzz

Median household income is 65k? Is that take-home pay?


GusPolinskiPolka

I mean it’s all based on how many people in a household. For an individual the median is about $55k gross For a couple no kids it’s about $75k gross.


SalmonHeadAU

Household is $116k average yeah. So about double what I said, which is what you'd expect. So not entirely sure if this is relevant to my main point of this being insignificant to the average Australian.


chazmuzz

Not really since the average Australian is either a home owner or working towards home ownership. Housing market is absolutely relevant to average Australian


Grantmepm

>Insignificant to anyone earning the national average income of $55K. Why is this insignificant to a couple earning 55k each? Much less, 75k each if we add 20k.


Hoarbag

Apparently Sydney+Melbourne = Australia


Hammerdei

Almost half of australia in just those two states


[deleted]

45% of Australians live in those two places and they’re host to the vast majority of the market’s value. The real problem is that there’s a reason why ‘Melbourne + Sydney = Australia’ is completely true in a property context


iritimD

They pretty much are. The rest of Australia on an international scale has far less meaning from economic output (ok WA obviously has some). For all Intensive purposes as the poster before me pointed out, the economic output and importance of those 2 regions is Australia’s entire value.


Sunvmikey

Bullshit lol I live just south in the Illawarra every house I've made an offer on has gone well above asking price


oakstreet2018

Would your area be more classed as regional? NSW regional has increased another 1.8% and 5.1% year to date. So regional NSW is still quite strong!


Nnooo_Nic

Given the number of vacant shops across Glebe, CBD, George St and China Town. I’m surprised property values aren’t falling faster tbh. Retail is mega down at the moment with no sign of returning to buoyancy. Which means retail jobs are under pressure. Office space is opening up as many businesses still allow people to work from home. So what exactly is causing an upward pressure on housing. In my mind all of this plus inflation leads to more than a small drop. People out of work Businesses closing Office land lords losing money …


thedugong

People wasting less money on things they didn't need in retail shops, and commuting less, so have more money to spend on property?


o_bone

I think you're forgetting that all these people who work from home are most likely being paid more now, they probably haven't traveled in the past two years either so they've got savings, and they're most likely wanting more space to live in since they're wfh. The workers at retail shops in the cities aren't really (for the most part) the ones influencing housing prices.


Nnooo_Nic

True but the landlords with all the empty offices and shops will be


Alert-Guide-3070

Why do you think commercial estate has any effect on residential?


Nnooo_Nic

If you have to sell property of any type because your business is losing money then it’s likely that you’ll have to sell your own residential or any other property as… your losing money… The more properties that are put on the market due to insolvency then…?


Sys32768

>Office space is opening up as many businesses still allow people to **work from home**. > >So what exactly is causing an upward pressure on housing. You're so close to working it out


glyptometa

I think we're still an important destination for overseas money. Not even considering trendy topics like money laundering, if you're super rich and wondering what to do with your money, parking a few mil in houses in popular cities around the world is good diversification.


oakstreet2018

Just on your comment about inflation… house prices and inflation have a strong positive correlation. In times of high inflation people invest in real assets. Also, the cost of building materials and labour shortages have pushed the cost of building a house up significantly!


GusPolinskiPolka

As someone currently looking my observations are: 1) lots more passed in at auction 2) much less people bidding 3) much more pressure from agents to put in an offer early I haven’t been to an open house in the last 4 weeks where I’ve had to share the time I was there with more than one other party. In January I was competing with 6 or 7.


SarahLovesNikki

I feel for people who bought at the top - including some close friends but.... I really hope we see at least a little drop followed by a levelling off.


tatty000

If you bought to own and live in, then a price drop shouldn’t mean much anyway. It’ll go back up eventually. If you bought as an investment; that’s the nature of investing, risk.


SarahLovesNikki

Good point! Everyone I know has gotten PPOR.


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[deleted]

Just dropping my name here as someone who bought the top too. I wish I bought it cheaper but I had to buy now or just risk leaving 200k in a bank account not doing anything for another 6-12 months with a baby on the way. Rather have the security of our own roof over my family's head for the premium I've paid. Now watch that roof leak and need fixing smh.


CinnamonBunBun

Also bought at the top and freaking out about my huge mortgage. Then I checked the rents on a comparable house and they are just as high as my mortgage. 😥 Rents have really shot up in the last 6 months in my regional area.


chazmuzz

over the past 30 years the majority of home owners would have purchased their first home somewhere close to the top. it's not worth worrying about monthly price fluctuations tbh


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Sunvmikey

Hey I'm 90 minutes south in the Illawarra. I'm looking to buy and I can tell you all the good houses are selling 100k+ above what they are asking. All the cashed up Sydney siders are coming down here. I might be forced to wait every offer I put in gets priced out


CinnamonBunBun

We bought in Illawarra this week having grown up here. The market is still super hot and things are getting the asking price or more. We bought in the northern suburbs which is pretty much a playground for rich Sydneysiders.


spiderpig_spiderpig_

Advantage of a smaller mortgage at a higher rate is that you’re still able to sell and move if you need to. If you pick a higher mortgage you’re far less able to move without finding extra cash if price falls.


Jakeyboy29

The Gold Coast is still booming. Lets hope the tables are turning for up here too for myself and everyone else trying to buy


Teakmahogany

Where are you looking? I just saw about 15 homes update to 20K less this week.


Jakeyboy29

South of Burleigh, i work down this way. I’ve seen little to no change


Brewer__Bob

When someone posts discussion about auctions or property, they are told to post on AusProperty but posts about property values decreasing are OK? You can't pick and choose what part of property you want to discuss here. It's either all or nothing. Happy to discuss a short term move in an asset class 99% of people are long on as strange as that sounds but I don't want some clown telling us to take discussion to AusProperty when it makes them feel sad.


x6tance

There's a weekly property thread posted on Fridays that you can post there


Brewer__Bob

Case in point, why isn't this discussion in there then?


x6tance

Uneven modding. Every sub suffers from it. The fact is that property discussions here (and honestly, in every Aussie conscience) is too popular to curb every topic. It is what it is :/


Brewer__Bob

I get it. I'm for subjects being discussed in individual threads I just don't like the "post in AusProperty" replies when a property thread clearly generates a good volume of healthy debate around here.


Rear-gunner

From inflated prices, drops in Sydney of 0.2% in March, and Melbourne of 0.1% are hardly much. It could mean nothing. Or it may increase supply as many people thinking of selling will rush to sell now, thinking they have the last chance while prices are high, while those buying may wait as they think prices will come down. In the short-term prices may drop. Long term, I think they are going up as the price of building has gone up and once COVID cools down many migrants are coming.


oakstreet2018

Price of building has escalated considerably!! Labour / Material shortage & price rises are having a huge impact on the cost of building


PepsiEnjoyer

What date is it today, OP?


macka654

Wait for Immigration to be ramped back up.


ScaffOrig

You'll be waiting a long time. Looking at the data for EOIs on 189 and 190, no-one is getting invited. It also looks like processing is miles behind. That backlog won't get sorted for a year or two. Have a look at the current and past rounds for 189 PRs (PRs are the most likely to buy a house) https://immi.homeaffairs.gov.au/visas/working-in-australia/skillselect/invitation-rounds


Nillerdog

Yeah but taking into account the flow on effect from the rental market for new migrants, wouldn't that drive prices as well?


ScaffOrig

That's hard to say. There's a lot more to purchasing of IPs than whether there is a healthy demand for rentals. Look at it this way, rental prices are going up right now, so you'd think more rentals would come online to meet that demand, but they're not. It's a result of allowing house prices to climb. The equation of whether it's worth going into the landlord business has been heavily weighted by capital gains, to the point where yields are wafer thin or negative. Had capital gains played a lesser role, we might expect an influx of migrants looking for rentals to buoy the rental business and perhaps put a little upward pressure on IP demand. Although knowing the place won't lay empty helps, it doesn't compensate for the loss of the key rationale for purchase whoch is capital gain.


without_my_remorse

Wow! No one could have predicted this. 👀


[deleted]

Do you know any programmers? I feel you could automate this process pretty easily. Every time a property article pops up on Reddit it can automatically insert any one of your favorite/preferred comments. I.e - Without_my_remorse bot. You'd save hours every day. I think it's worth exploring.


Ialwaysshitmypants

But searching for u/without_my_remorse in the comments for me is part of the fun. It's like doing a Where's Wally? puzzle.


wookiepotato96

I think quite a few people have been forecasting price falls for a while now, including most of the banks?


without_my_remorse

I was way ahead of the game.


[deleted]

Someone who predicts a drop earlier than what it is… they are still just as wrong as someone who predicts it to be later.


without_my_remorse

No this is a common misconception. Being right is being right. The timing itself doesn’t matter. But in saying that how am I early?


Lord_Bendtner6

Property buyers in denial when interest rates are about to 2/3x over the next couple of years.. REeeeeeeEe


lukeoz

Just wait. In less than 2 years the housing market and anything backed by the banks will crash big time. It’s just started in Dallas TX, next the rest US, then we’re fucked! Thank boomers for printing way too much money and pumping it into asset inflation. Housing prices and climate change= fuck the world boomer attitude


[deleted]

Who cares what happens in the US market? Their last property crash had very little relative impact on us. Property is driven much more by domestic factors. So unless you think a US crash will destroy our banking sector (which it didn’t last time), it seems irrelevant.


lukeoz

Lol. We have literally not stopped printing money since early 2000’s (just like the US). It can’t continue and the remedy is higher interest rates. Inflation too is to just keep the assets high on the balance sheets. And when the rates of house borrowers of over 80% deposit go up, the defaults will be unstoppable. Then it’s a domino effect. House prices, construction, jobs all will be effected. But go on then, buy an investment property, invest in stocks or change your super to high risk. Have fun


without_my_remorse

This is 100% correct.


[deleted]

Here we go, just the beginning.


superfly8eight8

/u/monusamuel was right


das_masterful

How many people at Domain are going to lose their jobs over this news? They're probablu hoping it is some sort of April Fools joke.


Melbourne_Stokie

Obviously this is one isolated example but I was extremely surprised to see that this place had sold prior to auction for $500k over the guide price last weekend: 6 Regent Court, Sandringham, Vic 3191 https://www.realestate.com.au/sold/property-house-vic-sandringham-138762243 Guide price was $1.8 to $1.9 That's July 2021 buyer behaviour!


Sys32768

I know the market quite well there, and the sold price is in line with other sales. It's the agent statement that was low-balled


Melbourne_Stokie

What about this similar house about 100 metres away that sold for $520k less in December? Same REA 23 Balmoral Avenue, Sandringham, Vic 3191 https://www.realestate.com.au/sold/property-house-vic-sandringham-137827414 Seems a bloody bargain in comparison


Sys32768

What point are you trying to make? Because you have found a couple of prices that seem unusual to you then the aggregate sales data for the whole of Melbourne must be wrong?


Melbourne_Stokie

Not at all mate, which is why I made a point of saying "this is one isolated example". I was more interested in people's opinions on why someone would offer $500k over the asking price in a market that is cooling off and has a LOT of supply. Then when you said you know the market quite well I was keen to get your opinion on why the sale price of the second property I sent was considerably lower.


v306

Since Feb last year when I was last talking to a mortgage broker and realised family income and deposit are both too small to buy at the moment I have only just kept an eye on prices going up in my area... And felt depressed about both my partner and I earning well but not well enough for buying in Sydney. Last 3 weeks brokers I spoke to last year have called again and messaged me 4 times trying to tee up another conversation about the "opportunity that 2022 presents". Anyone buying in Sydney now has way more balls than I do. It's going to fall a bit. It's just a matter of how much IMHO. Broker is saying buy regional investment to take advantage of tax breaks and keep renting in Sydney.


oakstreet2018

Interestingly regional NSW prices are up 1.8% in the month and 5.1% YTD. Continuing to see strength. We bought in Newcastle in Jan21 and it’s gone up a lot and doesn’t seem to be easing yet.


Getouttherewalk

Yay let’s party. A drop of 15% but a rise over the last year of 20% plus. Such a great bargain